Net Metering

Understanding Your Power Bill

Most cooperative members have a fairly simple rate structure made up of two parts – a member charge and a kilowatt-hour (kWh) charge. The member charge is a fixed amount, and the kWh charge varies based on the amount of kilowatt-hours a member uses each month. The member charge helps the cooperative recover a small part of the fixed distribution costs of serving members, including expenses such as administration, operations and maintenance. However, the majority of revenue needed to cover these distribution costs comes from kWhs sold to members. The cost per kWh is made up of three components – energy (kilowatthour), demand (kilowatt) and distribution expenses, shown proportionally in the graph on the right, using an average of 10 cents per kWh.

Missouri Net Metering

Net metering is a process that enables members with a wind or solar system on their home or business to export power that is in excess of their immediate on-site needs. This offsets an equal amount of power supplied by the cooperative at a different time within the same monthly billing period. In this situation the member is billed at the regular cooperative retail rate for the “net” amount of power used that is in excess of power the member generates on site. If members generate more power than their home uses during the monthly billing period, the excess is metered and put out onto the electric grid. The cooperative subtracts the amount of power purchased from the grid from the amount generated out to the grid and provides the member with a “credit” for the “net excess” power. For most Missouri cooperatives, the credit is calculated by multiplying the number of “net excess” kilowatt-hours times Associated Electric Cooperative’s cost to purchase the fuel needed to generate a kilowatt-hour (called avoided cost). Example: Member solar panels generate to the grid: 1,000 kWhs Member receives from the grid: - 950 kWhs Member receives avoided cost credit for: 50 kWhs

Under current net metering laws, the co-op is not able to recover distribution expenses and demand costs through kilowatt-hour sales when a member installs a solar array or wind turbine. Those costs are then spread to the cooperative membership without solar or wind to maintain vital infrastructure – distribution lines, poles and equipment, along with the transmission network and power plants delivering 24/7 electricity to all members. Why are all these resources needed? The energy output from solar or wind does not typically coincide with members’ peak load – early in the morning on a cold winter’s day. That is why a diverse power supply, including coal and gas, is so important. The chart on the right shows replacing Associated’s existing baseload resources with 5,000 megawatts of wind or solar leaves a huge gap between what our members need to power their homes and what wind or solar would provide on a peak winter day

Expanding net metering laws would harm most members Renewable interest groups and solar vendors would like to see significant changes to current net metering statutes that would increase subsidies paid by members who don’t have wind or solar. Key points of their suggested changes are listed below. Increase system size: The current law limits net metering to systems of 100 kilowatts or less; these groups would like to increase the size to 500 kilowatts or less. This would allow businesses to put in larger arrays that generate more electricity, reducing the kilowatt-hours they purchase from the cooperative. This shifts more costs of maintaining the grid to the rest of cooperative members. Retail rate credits for net excess: Paying the retail rate for a kilowatthour unfairly shifts more costs onto cooperative members who do not have a wind or solar system. It also forces a cooperative to pay a higher cost to purchase power than they would incur with their own generators. Annualized net metering billing: This has the same effect as paying retail for any net excess. Annualizing the net metering account would carry the monthly net excess forward as kilowatt-hours at a retail rate, not a credit for kilowatt-hours at avoided cost.

If you are interested in applying for interconnection with Tri-County Electric Cooperative’s electrical system, you should first contact the Cooperative with your membership account information and make sure you have fully reviewed this information.

It is no longer a requirement for the member-generator to purchase liability insurance for the distributed generation unit. In fact, the law states that the manufacturer of any electric generation unit may be held liable for any damage to property or person caused by a defect in the generation unit. The Cooperative still strongly suggests that a member-generator considers liability insurance. If there was a malfunction, the member-generator would likely be named in a lawsuit as a channel to get to the manufacturer. The law clearly states that the retail electric supplier shall have no liability absent of clear and convincing evidence of their fault.

As a protection for the Missouri member-generator, any seller, installer, and/or manufacturer who misrepresents any electric generation unit’s safety or performance standards may be investigated by the state Attorney General upon report.

All of the electricity generated by the distributed generation unit will first be used at the member-generator’s site. Any excess electrical power will go back on the grid and be recorded with the use of a special metering system at the member-generator’s location. The cost to upgrade the metering will be paid by the member-generator. An estimated cost of the special electric metering system is available upon request.

Touchstone Energy® Cooperatives is a national network of electric cooperatives across 46 states that provides resources and leverages partnerships to help member cooperatives and their employees better engage and serve their members. By working together, Touchstone Energy cooperatives stand as a source of power and information to their 32 million member-owners every day.